I saw this move coming. While the LSE never officially announced that its Windows and .NET stock trade software TradElect was the root of its September failure and perpetually slow performance, it was an open secret in the City -- London's equivalent to America's Wall Street -- that that was the case.

In a world of high-frequency trading where a millisecond really can mean the difference between profit and loss, stock exchanges can't afford to be slow, never mind actually going off-line.

The platform itself is built primarily on Linux, but Solaris and Cisco networking also play important roles. The back-end database engine is based on Oracle.

The LSE expects to see transaction speeds drop from a claimed best speed of 2.7 milliseconds -- which was rarely, if ever, seen under TradElect -- to the Linux solution's claimed 0.4 millisecond speed.

It wasn't just raw speed though that brought the LSE to Linux. Linux is cheaper, a lot cheaper, for high-end servers.

According to an IBSJ report, David Lester, director of information and technology at LSE, said that compared to the annual bill of $65 million for TradElect, MillenniumIT was a bargain at a purchase price of $30 million.

The LSE predicts that moving to Linux will give the company an annual cost savings of at least £10 million ($14.7 million) from 2011-12. In addition, "The new technology is a lot lighter, nimbler and easier to install" and will also enable faster releases.

The LSE hopes to close the deal this month. The transition from TradElect to the MillenniumIT is expected to take up to 18 months. Lester hopes to get it completed faster than that.

In the end, the LSE and its traders will profit from this move. As Steve George, director of corporate services at Canonical (the company behindUbuntu) told me when we talked about the deal.

"When performance and stability matters, as they do in business, Linux is the positive choice.

This move will be good both for the LSE and its customers and to the wider family of Linux."